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Our Insights 22 Jun 2016

The Business Response to Displacement & Migration

By Denise Delaney
A woman in Germany welcomes incoming refugees to the country. © Press Association images

A woman in Germany welcomes incoming refugees to the country. © Press Association images

More than a million refugees crossed into Europe in 2015 alone, part of the 50 million refugees worldwide. According to the World Economic Forum, if a country was created from all the displaced people it would be the 24th largest in the world.

Migration is not new, but the scale in Europe in contemporary times is. It is not the first refugee crisis – consider Europe after World War II, and situations in the Middle East, Africa,Latin America and Asia since – only in a higher concentration (largely by Europe’s own doing) and closer to home. Only true optimists would say it is the last. Lest we forget, the oldest refugee camp (since 1991) is a long way from Europe in Dadaab, Kenya, hosting more than 300,000 refugees. While it’s the latest chapter in a long history of displacement, the ‘choices’ migrants1 have are still abysmal: refugee camps, urban poverty and/or dangerous, usually illegal journeys to safety.

The business and moral case for caring about and acting on the ‘crisis’ of refugees and migrants in Europe is here and now – and frankly, has been for some time – and will be with us for a while to come.

But it’s political, many say. This is true – to a point.

Governments and the European Union have been wrangling with what to do, culminating in an uncertain one in, one out deal with Turkey that may endanger migrants. Even the bright spot in Europe where refugees were most welcome, Germany, has dimmed after challenges with crime against women that, for some, highlights the tall order of integrating refugees socially and culturally. Others worry that a warm welcome in Europe incentivises more people to move, enriching smugglers. Given that many migrants are middle class and collected enough money to pay high smugglers’ fees, it is a real concern but also testament that migrants are “asking not for handouts, but for the chance to earn a living.”

Companies are Responding

The repercussions of inaction (i.e. a more unequal, unstable society) are too great for business. Understanding the dynamics and where business can contribute through its core activities and strategies, as well as respond effectively in philanthropic ways, will make business more resilient. Isolating people from mainstream economies and societies cannot be good for business.

I spoke with two companies, IKEA and MasterCard, to get their first-hand views of what the refugee crisis means for business and what can be done. “We experienced people literally walking through Serbia,” I heard from Irena Dobosz, Sustainability, Customer Relations and Communication Manager, IKEA South East Europe, “I’m very proud that IKEA mobilised very quickly in all affected countries,” she added, explaining that IKEA everywhere has projects supporting local communities as part of delivering on the company’s vision of ‘a better everyday life’ for people, regardless of where they are. In the unanticipated circumstances, management’s support was crucial. “All long-term projects had been budgeted well in advance. This was new and unexpected, but we still got the additional support and it’s on-going.”

The business and moral case for caring about and acting on the ‘crisis’ of refugees and migrants in Europe is here and now.

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In collaboration with the UN Refugee Agency (UNHCR) and other local organisations, IKEA Retail focused on donations in-kind, providing all kinds of household items and furniture – from beds, mattresses and bed linen to baby items and interactive toys for child-friendly areas in refugee camps organised by Unicef and others. In some countries, consumer donations are matched (or multiplied) by IKEA. In many countries, IKEA co-workers are actively involved. For instance, in Germany, IKEA co-workers are engaged to support refugees and IKEA donates home goods products, to the point of experiencing a shortage of beds at one point.

Not only is IKEA’s follow through impressive, but IKEA Foundation has a relatively long history of action in this area. Since 2010, the company has financially contributed to the UNHCR – €76 million in years recent alone, makingIKEA its largest corporate donor – and also supported Médecins Sans Frontières in Syria and other affected areas. Since 2014, UNCHR and IKEA Foundation have also partnered to run the Brighter Lives for Refugees cause-related marketing campaign to raise funds. For every LED light bulb (and later lamps as well) sold during the campaign period, the IKEA Foundation donated Є1, which summed up to Є30.8 million, to bring light and renewable energy to refugee camps across Africa, Asia and Middle East. A uniquely IKEA contribution as ‘masters of flat pack’ is loaning their know- how and design expertise to housing, developing the social enterprise, Better Shelter (aka ‘IKEA shelter’), to provide innovative and more effective temporary home solutions.

In combination, the work via IKEA Foundation and the company itself, is powerful. The company’s response is also evolving to develop pilot internships and work experience opportunities to more fundamentally support refugees longer term. As Dobosz sees it, “I believe that refugees most want to be back in their homes, in peace. I am hopeful for them that they can return one day. For those who do not or cannot, I hope that they have a real option for integration.”IKEA also recognises the power of collecting and communicating the stories of its employees, internally and externally, to shift public opinion.

Speaking to Paul Musser of MasterCard, it was evident that the company’s actions in a crisis like this one are deeply rooted in the Shared Value model the company adopted several years ago. “There is shared value in being engaged before, during and after a humanitarian crisis,” Musser explained. With the support of the CEO and Vice Chairman, MasterCard’s International Development Team works to provide solutions based on the company’s analytics, technology and consulting tools to create systems and processes to advance financial inclusion. In providing these tools, from digital food vouchers to pre-paid cards, in response to social and humanitarian challenges, MasterCard sees strategic, long-term value – the intersection of doing good and doing well.

MasterCard has built a financial infrastructure that enables digital payments for millions of people to obtain essentials like food or money with organisations like the World Food Programme in Turkey, Lebanon and beyond. MasterCard views these efforts as a long-term business investment where the products and services offered to the humanitarian and development community create a foundation for future growth. MasterCard is creating a sustainable business thatNGOs and governments can trust and build into their long-term practices.

One of the greatest benefits that MasterCard contributes to refugees and migrants through digital payments technology is the social integration it can help enable. With Mercy Corps in Serbia, pre-paid cards that refugees can use to buy food, healthcare or transportation look no different from other cards. By not differentiating them, you empower them. Removing the stigma has the potential to integrate refugees and migrants into our social fabric. At play is both a commitment to quality products and respect for people. By enabling vulnerable populations to build stronger communities and begin the path to financial inclusion, MasterCard is also creating potential users of its mainstream services in the future. In its international development work, MasterCard asks itself, “How do we meet the market’s needs while also aligning with our vision?”

What Should Business Do?

In addition to learning from the examples highlighted above, how else can business act? Here is a summary of how we believe companies should be thinking about migrants in Europe or elsewhere.

Act where it is material. Consider how the issue has become material for the fashion industry. Turkey currently hosts the most refugees in the region and is the third largest textile exporter to the EU. Combined with estimates of 250-400,000 Syrian refugees working illegally in Turkey, as reported by the Business and Human Rights Resource Center, it should come as no surprise that global fashion retailers including H&M, Next, and Primark are identifying and reporting Syrian refugees working informally there. The protection of refugee and migrant workers, the majority and most vulnerable among them women and girls, is paramount. Companies should exert the full power of their supply chain policies and procedures, appetite to partner, and ability to influence government as needed to protect vulnerable people from exploitation and abuse – from trafficking to forced labour to child labour – in supply chains.

Use business’ voice and influence. Chobani’s owner, founder, chairman andCEO Hamdi Ulukaya has been an inspiration on this point and we hope more companies – especially large, global ones – will follow suit. Corporate forces have the ability through their voice, as well as their actions, to help recast the political and social debate. This could entail actual political and policy advocacy (e.g. advocating for migrants to have the right to work, which they lack in some countries) or apolitical communication of the company’s point of view and actions to the wider public to try to shift public opinion. Where are signals of an emergent chorus of voices to join that of Dieter Zetsche, Chairman of Mercedes, who said, “Most refugees are young, well-educated and highly motivated – they are exactly the people we need…They could, like the guest workers from decades ago, help us preserve and improve our prosperity. For Germany cannot anymore fill the jobs available only with Germans.”

Hire refugees. Take the opportunity to bring needed competencies to labour markets. Migrant flows create opportunities for business and labour where there is not enough of it. They are, “similar to ourselves, they have aspirations for university, for careers; says Paul Donohoe of the International Rescue Committee. Corporate operations and their supply chains can benefit from corporate hiring commitments, and rewarding suppliers doing their bit to hire and support refugees. Chobani has hired as many refugees as it can in its yoghurt plants, currently 30% of the total workforce. IKEA is looking at internship possibilities and and Uniqlo’s parent company has committed to hire 100 refugees, a relatively small number, but a start.

Respond in ways aligned with your core business. Some sectors can obviously respond to the known needs of these situations – IKEA and home goods, for example, or Pearson’s partnership with Save the Children, Every Child Learning, to provide education. Facebook’s Mark Zuckerberg has also drawn attention to the fact that refugees are amongst the four billion people without reliable internet access, promising to help the UN bring internet connectivity to refugee camps throughout the Middle East. While some criticise the effort for angling for new users, most agree that internet access will enable reconnection amongst the displaced, open opportunities for e-learning, and allow skills and capabilities to be shared with the rest of the world.

Consider the moral case. Inequality, top of mind for many leaders today, is particularly stark when combined with the vulnerability of people on the move.

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Think laterally. The solutions you can offer may be less obvious. Are there parts of the business or tools at your disposal that might be effectively adapted? Some will be surprised by MasterCard’s role in enabling the provision of aid. In another example, the pharmaceutical company Novartis, which had a traditional donations-based role in humanitarian crises, went beyond by unexpectedly partnering Novartis Access with the International Committee of the Red Cross to improve care and treatment for Syrian refugees populations in Lebanon who suffer from chronic diseases, such as high blood pressure and diabetes, which account for more than 50% of deaths in Lebanon annually. Novartis Access is its new social business making it affordable to treat chronic diseases in lower-income countries, initially only in Kenya and Ethiopia, through governments andNGOs for $1 per treatment per month. It was only launched last year, but the company thought laterally and flexibly about its utility in the refugee context. The partnership even has a longer-term objective to develop a broader blueprint for diagnosis, treatment and follow-up improvements for refugees with chronic diseases.

We know that responding in any one of these ways is not without challenge and may be subject to criticism. Chobani has not been immune, being attacked by anti-immigrant advocates in the US that the company is, “just looking for cheap refugee labour to make sure that [its] profit margin is good,” as reported by the Financial Times. But companies with a robust corporate responsibility/sustainability strategy and certain of their approach – the benefit to migrants and the strategic value to the company – can refute this. As Musser told me, “A company deriving value doesn’t detract from or diminish the impact of their actions.”

We see more and different actions – where it is material for business, where it is aligned with core activities, etc. – holding real potential to improve migrants’ lives. Not convinced that this makes sense for business? Then look around you and consider the moral case. Inequality, top of mind for many leaders today, is particularly stark when combined with the vulnerability of people on the move. I’m convinced that the solutions that will help migrants most will also help business. In the short-term and the long-term. As Alexander Betts, Refugee Scholar and Director of the Refugee Studies Centre at the University of Oxford, so powerfully puts it: There’s nothing inevitable about refugees being a cost. They’re human beings with skills, talents, aspirations, with the ability to make contributions — if we let them.

  1. We use the terms “migrant,” “refugee” and “people on the move” to refer to the BBC’s definition of “migrant” as “all people on the move who have yet to complete the legal process of claiming asylum. This group includes people fleeing war-torn countries such as Syria, who are likely to be granted refugee status, as well as people who are seeking jobs and better lives, who governments are likely to rule are economic migrants.”

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